On levies and collective payments for music

Most levies involve observing download behavior – an activity that not only wrongly incentivises the industry, but also may be technically more challenging than proposed.

As you adjust peer networks to be monitored, these networks lose their value as markets for anonymous activity and behavior. A network appliance installed to monitor music traffic could be “upgraded” to monitor other behavior. Peer networks should remain markets for anonymous behavior (in my opinion). The technology put in place to monitor activity compromises the anonymous and open status of peer networks. Sampling, as often mentioned, is an option, but has its weaknesses. Example: how can we monitor activity in networks we now claim cannot be monitored for copyright controls? With widely available services, with unique legal relationships with providers, music activity alone is the monitored, these relationships can be limited and sampling is unnecessary.

Regardless of levy or fee, I think the measures of these models need to be more adequately addressed. I think fees aligned to use, rather than distribution, will prove very influential towards rightly compensating artists. And I think I have the data to prove it.

The publishing industry, which carries a balance of both use and sale compensation, is structured very differently from the recorded music industry. 4 publishers do not control 80% of the works (i believe)- even though the major labels hold very large publishing arms.

Pay to hear, as the model based upon use is sometimes termed, has a unique advantage in that it does not require the artist to continually pimp his fans with new products. Under a use model, a good song is measured not only by how many people listen to it, but also by how often it is played by any one person. An independent artist, with 10,000 fans, who listen to a song 100 times, has earned as many credits as a larger artists who got 1,000,000 people to listen to a single song once.

Thus, as an incentive, those who might invest in the the less popular artists (which could be a label, fans, or the artist themselves) can find returns in the use of these works. The job of the artist and investor is not to create only those works that appeal to a mass audience, but also those works that appeal, deeply, to a narrow audience. If people want to market towards one-hit-wonders, they can. If other want to market towards deeply treasured music, they can. The former can still focus on releasing product after product. That latter can focus on releasing products that last on their own. The CD is not a loss leader, followed by tshirts, concerts and autographs. The recorded work may be able to stand on its own as a business.

Presently, the market highly rewards successful marketing regardless of consumer follow on. An album sold is as valuable to the seller whether it was sold to a buyer who listened once, or a buyer who listened 50 times. The same would be true for download-based compensation schemes. I think we can change this incentive structure and the result will be a more fluid industry for the consumer, artist and investor.


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